NYRA told to come up with reform plan ASAP

Published 10:39 pm, Sunday, May 20, 2012

Charles Hayward, former president and CEO of NYRA, right, and Ellen McClain, the recently named replacement for Hayward as president. (Skip Dickstein / Times Union Archive)

Charles Hayward, former president and CEO of NYRA, right, and Ellen McClain, the recently named replacement for Hayward as president. (Skip Dickstein / Times Union Archive)

Photo: Skip Dickstein

NYRA told to come up with reform plan ASAP

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For the second time this month, Gov. Andrew Cuomo presided over a face-to-face meeting with trustees of the New York Racing Association, and this time his brow was full of creases, according to people close to those in the room.

In the first meeting two weeks ago, Cuomo stated his position indirectly but diplomatically to a dozen NYRA trustees in Albany. He told them things must change.

But last Friday in Manhattan, with the NYRA board's executive committee, the governor was more like a prosecutor. He bluntly stated that things will change.

The stronger message comes after the governor took exception to the board appointing a new president and general counsel when he would have preferred interim leaders while two state investigations of NYRA play out. The probes are covering the circumstances of a 15-month period of overcharging bettors leading to $8.5 million in unlawful commissions. NYRA's new president, Ellen McClain, was on duty as a top financial and compliance administrator during those 15 months.

Governors don't normally sit down with NYRA trustees for private meetings — so secretive that Cuomo's aides refuse to even acknowledge the sessions are scheduled, one even pleading ignorance when 12 NYRA trustees were converging on the Capitol.

Last Friday, Cuomo advised NYRA Chairman C. Steven Duncker, and vice chairmen — Michael J. DelGiudice, the speaker's appointee, James P. Heffernan, a Pataki appointee, and Charles Wait and Stuart Subotnick, NYRA appointees — that state control of NYRA is coming, including selecting the next chairman and nominating the next CEO. This all comes after Cuomo got NYRA's attention, and the attention of racing interests, by withholding NYRA's share of Aqueduct racino revenues. Cuomo's aides refuse to say whether the video lottery terminal money can legally be redirected to a Lottery account for safe-keeping.

Instead, Cuomo is telling NYRA what to do. He's giving them a week to come up with a fix-up plan that he can stomach, said one person briefed. Trustees may be distracted as they prepare to host the Belmont Stakes because the maintenance union is threatening a job action.

Lack of clarity at JCOPE

After the Joint Commission on Public Ethics informed Sen. Thomas Libous that it is pursuing an ethics complaint against him, lawyers in the ethics field were asked if the commission has authority to investigate a sitting lawmaker for actions that may have occurred prior to JCOPE's creation. Former lobbying commission executive director David Grandeau wrote on his blog that JCOPE can't do it. Other lawyers say it is clear that the statute creating the new agency is flawed. Given nearly a week to clarify JCOPE's jurisdiction on lawmakers' past acts, spokesman John Milgrim would not say. He read a statement saying the commission has the tools to perform its mandate of enforcing ethics laws, including in the legislative branch.

"With the law being silent on this, we believe JCOPE has jurisdiction," said Dick Dadey, of Citizens Union, adding the commission should be able to deal with the question.

One lawyer said the JCOPE law lacks specificity on other important matters. For instance, it doesn't state whether confidentiality requirements follow JCOPE employees or officers after they leave the commission.